The keiretsu of Japan arose out of the prewar zaibatsu but differed from the zaibatsu in
essential ways. The zaibatsu were family-owned conglomerate businesses
that were promoted by the Meiji government of Japan. When the government ran out of funds to
carry out major projects for the development of Japan the government commissioned private
businesses, often one which had business dealings with the court, to carry out those projects.
The businesses received in return monopolies and special privileges from the government.

The zaibatsu were strong supporters of the militaristic government that gained control of
Japan. The Allied Occupation broke up the zaibatsu to punish their leadership but also the
Occupation wanted to promote democracy and saw the zaibatsu as anti-democratic concentrations
of power. Initially firms such as Matsui were prohibited from operating. However the Cold War
dictated the necessity of Japan having a strong, vigorish economy. The zaibatsu companies were
allowed to re-form and utilize their old names. For middle management in those companies the
process was beneficial; they moved up in the management heirarchy.

The general structure of the keiretsu is an association of companies formed around a bank.
They cooperate with each other and own shares of each others stock.